Horizonte Minerals (TSX:LON:HZM) Significant new Nickel Resource at Serra do Tapa

Jeremy Martin, Chief Executive of Horizonte, commented, “The release of the new NI 43-101 Mineral Resource covering the Serra do Tapa deposit is another exciting development for the Company and increases our total aggregate nickel resource base by 30%.

Horizonte Minerals Plc, (AIM: HZM, TSX: HZM) (‘Horizonte’ or the ‘Company’) the nickel development company focused in Brazil which is developing the Araguaia project as Brazil’s next ferro-nickel mine and the Vermelho nickel-cobalt project for the electric vehicle (EV) battery market, is pleased to announce an initial NI 43-101 Mineral Resource Estimate for the Serra do Tapa nickel deposit (‘Serra do Tapa’ or the ‘Project’).

 

Highlights:

·    The Serra do Tapa Mineral Resources, in the Measured and Indicated category, are 70.3 million tonnes grading 1.22% nickel (at 0.9% nickel cut off);

·    The Company’s 100% owned aggregate Mineral Resource inventory shows a 30% increase in tonnage with the addition of the Serra do Tapa deposit;

·    A significant portion of high-grade saprolite within the deposit is amenable to the Rotary Kiln Electric Furnace (‘RKEF’) process route to produce ferro-nickel, potentially providing a further high-grade feed source for the Araguaia project;

·    The Company’s 100% owned Measured and Indicated Mineral Resources now total 280 million tonnes with 3.5 million tonnes (7.6 billion Ibs) of contained nickel and 155 thousand tonnes (3.4 million Ibs) of contained cobalt; and

·    Horizonte now owns one of the world’s largest inventory of undeveloped nickel and cobalt Resources globally, in a mining district with well-developed infrastructure.

 

Jeremy Martin, Chief Executive of Horizonte, commented, “The release of the new NI 43-101 Mineral Resource covering the Serra do Tapa deposit is another exciting development for the Company and increases our total aggregate nickel resource base by 30%.  The resource is high grade and scalable, using a 1.2% nickel cut-off grade it delivers over 41 million tonnes of Mineral Resource in the Measured and Indicated category grading 1.4% nickel.  The company now has 100% ownership of a nickel district, with over 280 million tonnes of resource (in the measured and indicated category), in one of the largest mining districts in Brazil, the Carajás district, which has good infrastructure, water, energy and skilled labour.  This generates the potential for Horizonte to develop two mining centres within trucking distance of each other, the first, in the south at Araguaia, where we are developing a ferronickel operation to produce around 14,500 tonnes of nickel with the Stage 1 plant expandable to 29,000 tonnes of nickel per year.  The second production centre in the north, at the Vermelho nickel cobalt project which has the capacity to produce 15,000 to 18,000 tonnes per year of nickel and associated cobalt.  Now we have additional high-grade material from the Serra do Tapa deposit which could serve either operation.

Work on Araguaia is focused around advancing the project finance and the recruitment and selection of the project development team as we move towards construction. 

The pre-feasibility study on the Vermelho nickel-cobalt project is at an advanced stage and is currently being finalised.  We aim to announce the PFS to the market later this quarter, providing investors with exposure to the fast-growing electric vehicle battery metals market.

We have seen increases in the nickel price over the last month with LME nickel trading at highs of around US$16,000.  The Base Case and the Stage 2 Expansion Case for the Araguaia Feasibility Study use US$14,000 nickel; however, based on the recent nickel price of $16,000, the project NPV on the Stage 2 Expansion Case is approximately $1 billion with an IRR of 30% generating free cash flow of US$3.5billion.  The demand picture for nickel is robust both from the traditional stainless-steel market and the evolving EV battery market.  Additionally, we are seeing continued draw down in global nickel inventories with the LME levels currently at 142,000 tonnes, the lowest levels for the last 6 years.  Consensus long term nickel price forecasts are currently around US$16,400, these fundamentals are positive for the development of Araguaia and Vermelho.  We look forward to updating the market on progress.”

Further Details

A total of 48,845 metres of diamond drilling (952 holes) were used in the evaluation of the Serra do Tapa deposit and for the development the Mineral Resource Estimates disclosed herein.

Table 1 Combined Classified Mineral Resource Report for Serra do Tapa by Nickel cut-off

Cut-off Ni%

Tonnage

(Mt)

Ni %

Contained Ni (kt)

Co %

Fe%

MgO%

SiO2%

Al2O3%

Measured

0.8

16.5

1.25

206.9

0.05

16.6

18.4

40.9

3.6

0.9

14.3

1.31

187.9

0.05

16.4

18.1

41.3

3.6

1.0

12.1

1.38

167.0

0.05

16.5

17.7

41.6

3.6

1.2

10.0

1.45

144.7

0.05

16.6

17.1

41.9

3.6

Indicated

0.8

71.1

1.12

798.3

0.05

17.0

18.5

40.2

3.8

0.9

56.0

1.2

669.5

0.05

17.0

17.9

40.6

3.8

1.0

43.0

1.27

546.1

0.05

17.1

17.1

41.1

3.9

1.2

31.7

1.35

427.7

0.05

17.3

16.2

41.4

4.0

Measured + Indicated

0.8

87.7

1.15

1,005.1

0.05

16.9

18.5

40.3

3.8

0.9

70.3

1.22

857.4

0.05

16.9

17.9

40.8

3.8

1.0

55.1

1.3

713.1

0.05

17.0

17.3

41.2

3.8

1.2

41.7

1.37

572.5

0.05

17.2

16.4

41.5

3.9

Inferred

0.8

4.0

1.04

41.7

0.06

21.9

13.5

35.6

5.9

0.9

2.7

1.14

30.5

0.06

22.3

12.3

35.9

6.0

1.0

1.9

1.22

22.8

0.06

22.0

11.7

37.0

5.9

1.2

1.3

1.31

16.7

0.06

21.6

11.3

38.0

5.8

Note: Totals in tables may not add due to rounding. Mineral resources which are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues. The quantity and grade of reported Inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred resources as an Indicated or Measured mineral resource and it is uncertain if further exploration will result in upgrading them to the Indicated or Measured mineral resource category.

 

Disclosure of the Serra do Tapa Mineral Resource brings the Company’s total disclosed Measured and Indicated nickel laterite Mineral Resources in Brazil to 280 million tonnes (at a 0.9% nickel cut-off) including 3.5 million tonnes of contained nickel, see table 2, below for details:

Table 2 Combined Classified Mineral Resources for Horizonte Minerals at a 0.9% Ni Cut-off

Project

Resource Classification

Material type

Tonnage (MT)

Ni(%)

Contained Ni metal (kt)

Co (%)

Contained Co Metal (kt)

Araguaia

 

Measured

All

18.2

1.44

261

0.05

9.9

Indicated

All

101.2

1.25

1264

0.06

60.9

Measured+Indicated

All

119.3

1.27

1525

0.06

70.7

Inferred

All

12.9

1.19

154

0.06

7.9

Serra Do Tapa

 

Measured

All

14.3

1.31

188

0.05

7.1

Indicated

All

56.0

1.20

670

0.05

28.0

Measured+Indicated

All

70.3

1.22

857

0.05

35.1

Inferred

All

2.7

1.14

31

0.06

1.5

Vermelho

Measured

All

87.6

1.23

1,073

0.06

47.5

Indicated

All

2.8

1.18

33

0.06

1.7

Measured+Indicated

All

90.4

1.22

1,107

0.06

49.2

Inferred

All

1.3

1.14

15

0.05

0.6

Totals

Measured

All

120.0

1.27

1,522.4

0.05

64.5

Indicated

All

160.0

1.23

1,964.1

0.06

90.6

Measured+Indicated

All

280.0

1.25

3,486

0.06

155.1

Inferred

All

16.9

1.18

200

0.06

10.1

Note: Totals in tables may not add due to rounding. Mineral resources which are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues. The quantity and grade of reported Inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred resources as an Indicated or Measured mineral resource and it is uncertain if further exploration will result in upgrading them to the Indicated or Measured mineral resource category.

Horizonte’s 100% owned Serra do Tapa nickel deposit, acquired from Glencore/Xstrata in October 2015, is near the Carajás mining district and approximately 90 kilometres North of the Company’s Araguaia ferro-nickel project.

 

Nickel cut-off grades and corresponding estimated Mineral Resources at Serra do Tapa are presented in Table 1.  The Mineral Resource is reported by a series of nickel cut-offs. The Mineral Resource was estimated in 2016 by Snowden Mining Industry Consultants using Datamine Studio 3 mining software. 

 

In accordance with the AIM Note for Mining and Oil and Gas Companies, Horizonte discloses that Mr. Andrew F. Ross, an employee of Snowden, is the qualified person that has reviewed the technical information contained in this announcement. Mr. Ross MSc, is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr. Ross consents to the inclusion of the information in this announcement in the form and context in which it appears.

READ
Europa Metals Ltd (LON:EUZ) Drilling Mobilisation and Operational Update

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

For further information, visit www.horizonteminerals.com

 



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